Microsoft launched Windows service pack 3 before few days back. You can download this update from Microsoft website and you can install it on your computer for latest updates and some new feature also. As per Microsoftif you are installing for a single computer they recommend to have a update installation of service pack 3 that is of lower size in data but Irecommend to download network installation pack and use it even if you reformat your machine you wont need to go to Microsoft website again for a new installation.

Network Access Protection compatibility. Announced years ago, this feature allows Windows XP machines to interact with the NAP feature in Windows Server 2008. This functionality is built into the RTM version of Windows Vista as well.

Product Key-less install option. As with Windows Vista, new XP with SP3 installs can proceed without entering a product key during Setup.Its applicable for those installation that will install with installation CD of windows xp with sp3. This would be similar to Windows XP . I did not get a chance to check it out so can not comment for this.

Kernel Mode Cryptographics Module. A new kernel module that "encapsulates several different cryptographic algorithms," according to Microsoft.

1)Take Backup: If you will apply this service pack without taking any backup than also it wont affect anything in your computer but most secured way is to take backup of your important system data like outlook dbx,pst file, your bookmarks and other settings like that. For taking backup you can use Norton ghost also that will create a complete backup of your XP with all installed software and settings so you can restore this latter. I Will post a detailed information about norton ghost very soon.

2)If you are using Vista theme of CrystalXP.net than make sure to uninstall your crystal XP theme and than reinstall it after installing windows XP sp3. If you will install XP SP3 without uninstalling crystal XP theme you will get an scattered resolution.

3)Previous System Restore Point would get deleted: If you have any previous system restore point that you want to use than do no install service pack three. If you will install service pack three all previous System restore point would get deleted.

I have given all the information from sources and my personal experience please use your brain before applying any thing .